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Here's Why Vertex Pharmaceuticals (VRTX) Fell More Than Broader Market

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In the latest close session, Vertex Pharmaceuticals (VRTX - Free Report) was down 1.68% at $440.87. The stock fell short of the S&P 500, which registered a loss of 0.22% for the day. Meanwhile, the Dow gained 0.08%, and the Nasdaq, a tech-heavy index, lost 0.51%.

Heading into today, shares of the drugmaker had gained 3.31% over the past month, outpacing the Medical sector's loss of 0% and the S&P 500's gain of 0.45%.

The investment community will be paying close attention to the earnings performance of Vertex Pharmaceuticals in its upcoming release. It is anticipated that the company will report an EPS of $4.24, marking a 133.05% rise compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $2.88 billion, showing a 8.85% escalation compared to the year-ago quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $17.82 per share and revenue of $11.91 billion. These totals would mark changes of +4142.86% and +8.06%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Vertex Pharmaceuticals. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.08% higher. Vertex Pharmaceuticals is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Vertex Pharmaceuticals has a Forward P/E ratio of 25.17 right now. This represents a premium compared to its industry average Forward P/E of 19.86.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 87, putting it in the top 36% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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